The Market for Smart Wearable Technology. A consumer centric approach looking at smart watches, fitness bands, baby monitors, pet trackers, hearables, wireless headsets and smart clothing and predicting the market growth between 2015 and 2020.

1. The Market for Smart Wearables
A consumer-based perspective
Nick Hunn – WiFore Consulting
nick@wifore.com

2. Why is the wearables market like the
opening song of a Broadway musical?

3. Wear am I going ? I don’t know.
When will I get there? I ain’t certain.
What will we get? I ain’t equipped to say.
But who gives a damn – I’m on my way!
Which is why Wearable Technology is currently at the top of the Gartner hype
curve.

4. Why is the industry so interested?
• Black slabs (aka Smartphones) are hitting a plateau
– They look the same
– They do the same
– They’re a pain to upgrade
• Once they fail to inspire us, they’re no different to
socks or light bulbs
– We’ll only buy a new one when the old one breaks.
As PC and laptop markets start to die and the pace of
smartphone evolution slows, market leaders are
looking to wearables as the saviour of their industries.

5. How do you measure the market?
What consumers want to buy? What vendors want to sell?
I’ve built up a view of the market based on what consumers might
want to buy and how many of them might be prepared to spend their
money on each type of wearable technology.

6. Defining the Segments
What will consumers buy?

7. Sports & Fitness
• Fitness Trackers
• Wristbands
• Smart Activity Clothing
But… not many people go to the gym – it’s limited
100
90
80
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60
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40
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20
10
0
2014 2015 2016 2017 2018 2019 2020
Millions

8. The “Curse” of the Reference Design
The game has changed from design to packaging
Chip manufacturers are designing pcbs and software preconfigured for
basic functions such as smart watches and fitness bands.
These allow multiple manufacturers to bring sub $15 products to market
in a matter of months, forcing prices down for everyone else.

9. Sports & Fitness
And prices of wristbands are plummeting…
$140.00
$120.00
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$0.00
Y
2014 2015 2016 2017 2018 2019 2020
Millions
Wristbands Cheap Wristbands
• Fitness Trackers
• Wristbands
• Smart Activity Clothing

10. Sports & Fitness
It becomes dominated by two sectors:
Professional / Serious Amateurs or Cheap / Free
$1,400
$1,200
$1,000
$800
Millions Fitness Tracker Wristband Activity Clothing
$600
$400
$200
$0
2014 2015 2016 2017 2018 2019 2020

11. Hearables
Things you can stick in your ear.
There’s a new Bluetooth standard being developed which adds audio
streaming to Bluetooth Smart for really low power products.
And it’s always easier selling a product for which content is already
available.

12. Hearables
It’s not just sound.
The Dash earbud records:
• Accelerometer data
• Pulse Oximeter data
• Heartrate
• Blood Oxygen Saturation
• Body and Ambient Temperature
• Steps
• Calories Burned
• Cadence
• Speed & Pace
• G-Force
• Distance
• Angle
• Gesture
The ear is a better place than the wrist
for most “health” measurements, as it
doesn’t wave around.

13. Hearables
It makes hearables a VERY interesting market.
By 2020 over 128 million products could be shipping, with a total
revenue of $17.3 billion.
That still only an attach rate of just 2.1%
$20
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2014 2015 2016 2017 2018 2019 2020
Billions

14. Personal Medical

15. The Tricorder Effect
Once products become available for ~ $250 which
can reliably diagnose common diseases, most
families will want one.
Most medics in Europe and the US oppose them, as they
threaten their income and status. They want to limit them to
being prescription-only devices.
As a result the market may take off in the Far East, with on-line
services in India. It’s difficult to predict volume because regulation
may distort demand.

16. The “Oh my God, I’m going to die” market
Targeting the “Live Slow, Die Old” demographic.
“Brian Bilodeau, now Senior Director of Personal Devices at Microsoft, was shocked
into action when his father-in-law passed away unexpectedly in his 60s. Bilodeau
said, “ I have to get in better shape. I don’t want to die young.”
That’s not an amazing, new business plan. It’s called life. Most people get on with it.

17. Loved One Asset Tracking
Where’s my baby, child, pet?
Possibly the ultimate guilt sale.
How would you feel if you didn’t have one and your pet / child /
baby got lost / stolen / died?

18. Loved One Asset Tracking
$900
$800
$700
$600
$500
$400
$300
$200
$100
$0
2014 2015 2016 2017 2018 2019 2020
Millions
Pets Kids Babies
Who do you love most?
It’s a market that may be driven by the tabloid press.
A high profile kidnapping story could see it rocket.

19. Fashion
Competing with the high street
The average street market has more variety than the entire
wearable tech market. That’s a major challenge for the industry.

20. Fan Clothing
Last year Foxtel launched the “Alert Shirt” to allow sports fan to feel the action, at a subscription of $1,000 per season.
If you could persuade 100 million fans to subscribe for $100 / year,
that’s an annual revenue of $10 billion.

21. Glass & Stuff
• Augmented Reality
• Smart Glasses
• Smart Cameras
• Gesture Recognition
All face social battles to find acceptability.
It’s difficult to determine whether consumers will want them.
But Mark thinks they’ll sell 50 - 100m Rifts by 2020. That’s an annual market of around $10 billion in 2020.

22. Who is the market?
• West Coast
• Large Wrist
• Male
• Geek
If I ask a San Diego audience “Who’s wearing one?”, the response is ~ 70%.
In San Francisco it’s about 50%
In Europe it’s around 10%
Outside a wearables conference it’s below 0.2%
Sony’s recent “highly successful” crowd-funding campaign for it’s
FES ePaper Watch only sold 137 devices. Beware the hype.

23. There’s a ticking
time-bomb which is
the Apple Watch

24. Smart Watches
• Apple have done something clever – they’ve made
the phone complement the watch rather than the
other way around. Plus it has Apple Pay.
• Samsung, Asus, LG, Motorola, Sony et al may have
trouble catching up.
Other than for Apple, the curse of the reference
design is at work. With a wide variety of $15 devices,
how do you get a consumer to pay $300?
Smartwatches do not compete with high end
watches. Smartwatches only have a life of tens
of months (not decades) and are accurate.

25. Smart Watches
• Cheap watches will account for over half the volume
• Apple will take less than half the remainder, but
• They’ll take almost 70% of the revenue
Unless consumers decide they don’t want smart watches.
$10
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$1
$0
2014 2015 2016 2017 2018 2019
Billions
Branded Apple Cheap

26. The global market for smart wearables
$35
$30
$25
$20
$15
$10
$5
$0
2014 2015 2016 2017 2018 2019 2020
Billions
Smart Watches Augmented Reality Fashion Kids & Pets
Medical Hearables Sports & Fitness
For more details, download the report from www.bit.ly/smartwear

27. But…
The more interesting market is the subscription
Service Models based on the data generated by
Smart Wearables.
That takes us to the next generation of content
provision, which is Sensation.

28. Nick Hunn
CTO
mob: +44 7768 890 148
email: nick@wifore.com
web: www.wifore.com
The Market for Smart Wearables: www.bit.ly/smartwear
Creative Connectivity Blog: www.nickhunn.com
LinkedIn: www.linkedin.com/in/nickhunn